Learning From (Others’) Experience

While the new health care reform law is a major step forward in the fight to provide affordable, comprehensive care to every American, Sen. Bernie Sanders has said there is much more that needs to be done to address the crisis in health care.  Sanders is a strong proponent of a Medicare-for-all, single-payer health care system and has introduced legislation which would make that a reality.  The senator also believes that states should be allowed to take the lead in demonstrating the effectiveness of a single-payer approach.  To that end, Sanders included in the health reform law a provision which gives states a great deal of flexibility to go forward on innovative ways to provide comprehensive health care to all their citizens. taiwan2

Sanders knows we have a lot to learn from the way other industrialized countries have dealt with the challenge of providing health care to everyone.  In Canada, it was the province of Saskatchewan which took the lead in demonstrating the effectiveness of a single-payer health system.  Sanders also points to the success of nations on the other side of the globe like Taiwan in instituting single-payer systems.  He told MSNBC’s Dylan Ratigan, “I just left my office, where the ambassador from Taiwan is there. In 1995, they instituted a program which now guarantees health care for all of their people, far more cost-effectively than we do in this country, through basically a Medicare-for-all single-payer approach. Long term, that's where we've got to go.”

Sen. Sanders sent his top legislative aide to Taiwan to learn more about the Taiwanese national health insurance system, a successful model of providing affordable, comprehensive care.  Michael Behan, Sanders’ legislative director and chief counsel, answered a few questions about what he learned in his tour:


Taiwan Q&A with Sanders’ Legislative Director

What’s special about Taiwan’s health system?
Taiwan insures 99 percent of its citizens through a single-payer national health insurance system that it started in 1995.  The other 1 percent is mostly people who live overseas and choose not to participate.  That's about as close to universal coverage as it gets.

How did they do it?
Over ten years, a special task force looked into different models of health coverage around the world and decided on a single-payer model, based on Canada’s system and very similar to our own Medicare system, except that it was designed to cover everyone, not only seniors.  They implemented the new system in 1995.

What was it like before that?
Taiwan had a crisis even worse than our own, with 13 different payers with varying premium and benefit levels that insured only 60 percent of their population.  So, before the 1995 reform, 40 percent of Taiwan’s people – mostly seniors, children and the unemployed – were uninsured.

Do people like it?
Overwhelmingly.  Public satisfaction came in at nearly 80 percent in the most recent poll, and has averaged over 70 percent since 2001.

How much does health insurance cost in Taiwan?
It’s payroll-based, and the government and employers share contributions for the insured and their dependents.  The government subsidizes the premiums for those with low-incomes.  Private-sector employees pay 30 percent of the premiums, the employer pays 60 percent and the government pays 10 percent.  For the employee, this amounts to about US$25 to $100 per month, depending on income level. 

What does it cover?   taiwan
The insurance people get is comprehensive.  It includes inpatient and outpatient care, laboratory tests, prescription (and some over-the-counter) drugs, dental services, and home nursing care, among other things.

Are there co-pays?

Yes.  Co-pays for outpatient care range from about US$1.50 to $14 per visit.  Co-pays for inpatient care are capped at $900 per stay and a total of $1,500 for the entire year.

How much does Taiwan spend on healthcare compared to other countries?
6.13 percent of its Gross Domestic Product, whereas in the U.S. we spend over 17 percent, and that number is projected by the Centers for Medicare and Medicaid Services to go over 19 percent by 2019.

Spending so little, does Taiwan have worse health outcomes than we do?
No.  As a matter of fact, life-expectancy has increased since implementation of the system, and many other health indicators have improved.

Is the national single payer system expensive to administer?
It costs Taiwan’s Bureau of National Health Insurance about 1.5 percent of the premiums they collect to administer the program.  Since the government pays this minimal cost out of general revenues, 100 percent of all premiums collected is paid out to providers.  It’s worth comparing that with our private insurance system: it was a struggle just to write into the recent health reform law a requirement that individual- and small-group plans pay out to providers at least 80 percent, and large group plans at least 85 percent, of the premiums they collect.  That means it was a fight to set a standard for private insurers in the U.S. just to limit their administrative costs, executive salaries and bureaucracy to no more than 15-20 percent!
 
Do people have choice of doctors and other providers?
Yes, people can go to whichever doctor they choose.  92 percent of all providers in the country contract with the Bureau of National Health Insurance.